Unbudgetted Spending: 21 Day LuxuriousCREDIT Challenge

Living life on a budget is not just a strategy for low in come individuals who are simply trying to make ends meet. Budgeting is about taking stock of your financial life, discerning where you are in relation to where you want to be, and living according to the plan that you have created to get yourself there. Creating a budget means putting a price tag on your goals. While it may seem simple and intuitive, many individuals must consciously and intentionally take the initiative to learn the financial skills required for LuxuriousCREDIT and economic success.

 The 21 Day LuxuriousCREDIT Challenge is designed to help those who are ready to commit to a better financial future by changing the way they live today. There are three simple steps to constructing a budget. By first figuring out where your money is going, learning a few simple financial rules of thumb, and setting concrete financial priorities anyone, including you, can be on the way to getting their financial life in order.

 Taking stock of your financial life is a means of figuring out where you are financially in relation to where you want to go. Are you single, married, in transition? Do you have or want children? If so, how soon will they be going to college and how will their tuition be paid? Are investments, travel, savings, entertainment, donations, or fashion important to you? If so, how much? These are all factors that must be considered and weighted in order from most to least essential to your personal fulfillment.

Once you have prioritized your spending and determined what your financial goals are, you are ready to begin working towards achieving them. If you are like most people, you may be slightly uncomfortable under the constraints of the “No Unbedgeted Spending” rule during this 21 Day LuxuriousCREDIT Challenge. Impulse buying is a compulsion that an entire industries are supported by. Many businesses achieve the majority of their sales as a result of last minute financial decisions. For the next 21 days, however, your task is to avoid these impulses and honor your commitment to yourself and your financial goals. You CAN do this! 

By committing to No Unbudgeted Spending you essentially stop the bleeding as far as your finances are concerned. Saving money is not easy for most people. Deciding to avoid spending on unplanned purchases can seem like an impossible task. The fact is, you absolutely can save. If you were to spend just one month tracking your spending by recording EVERY expenditure, you would discover that you can eliminate a number of spontaneous splurges and pocket the difference. If you don’t want to wait thirty days to begin the 21 Day LuxuriousCREDIT Challenge, you need not worry. The key is getting a handle on your current spending habits and then reevaluating your priorities.

 Now that you’re focused and on your way to LuxuriousCREDIT, here are a few financial rules of thumb to keep you on track:

 Your total debt (not including your mortgage) should be less than 20% of your net annual salary.

  • As a general rule, you should spend no more than 30% of your monthly take home pay on mortgage payments or rent.
  • Plan to save a minimum of 10% of your net annual salary.
  • If you have savings, use it to pay off any high interest rate debt you may have.
  • Whenever possible, transfer your debt from high interest rate loans to lower interest rate loans.
  • Do your best to maintain a 35% to 45% debt to income ratio.

By this point in The 21 Day LuxuriousCREDIT Challenge hopefully you have already begun to see and reap some of the many benefits of taking a step back and depriving yourself financially, for a short time. As you move through the components of the challenge, continue to maintain a results centered focus and remember why you started.


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